1982 (2) TMI 17

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..... the following two questions to this court under s. 256(1) of the I.T. Act, 1961, at the instance of the Revenue : " 1. Whether, on the facts and in the circumstances of the case, the Tribunal is right in law in holding that the interest payment to the Sugarcane Society and interest payable on the cane commission is an admissible deduction under section 37(1) of the Income-tax Act, 1961 ? 2. W .....

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..... me, the assesseecompany raised a claim in the same amount against the society for short supply of raw material. The society also raised a counter-claim against the assessee-company for a sum of Rs. 26,862 on account of the latter's contribution towards the construction of one village road. The dispute between them was referred to arbitration and it was decided that both the parties would withdraw .....

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..... of the above-noted question to this court. The learned counsel for the Revenue, to assail the correctness of the view of the Tribunal, contended that the amount in dispute was payable as interest on sugarcane price and cane commission during the assessment years 1961-62, 1962-63 and 1963-64. As the method of accounting of the assessee was mercantile, the deduction for the said amount could be clai .....

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